Frequently Asked Questions

Maryland Standard Offer Service

We deliver electricity, but we do not generate it. We purchase the electricity we need for ours customers from unregulated wholesale suppliers, who own power plants and produce electricity or who buy and sell it on the wholesale market. Maryland law requires us to use a competitive bidding process to buy electricity for customers who do not choose an alternative electricity supplier. Customers are charged for this service – called Standard Offer Service (SOS) – under rates approved by the Maryland Public Service Commission (PSC). It is estimated that the average residential customer will see a total summer bill increase of about 3.9 percent beginning with the June, 2015 billing cycle and a total winter bill increase of about 3.8 percent beginning October 1, 2015.

Competitive bidding occurs twice each year. Delmarva Power purchases the electricity it needs for its SOS customers from unregulated wholesale suppliers, who own power plants and produce electricity or who buy and sell it on the wholesale market. Contracts are awarded based on lowest price.

New SOS rates are effective for the Summer on June 1 and for Winter on October 1. Two times a year, Delmarva Power offers about 25 percent of the total residential and small commercial SOS peak load for bids. The bids are for two-year contracts. The bidding combination of load, contract term and bidding frequency has been approved by the PSC. This approach has a dampening effect on price swings.

RGGI Rate Credit

Also, a monthly rate credit which changes quarterly is being applied to the bills of all Maryland residential customers. The credit, entitled “RGGI Rate Credit,” appears as a line item on the bill. It provides a billing credit to help offset surcharges for the cost of programs that will decrease energy demand and promote clean energy to fuel Maryland’s future prosperity. RGGI stands for Regional Greenhouse Gas Initiative.

Funding for the RGGI credit comes from the Maryland Strategic Energy Investment Fund, which receives proceeds mainly from the sale of CO2 emission allowances by the State of Maryland. The credit is a direct pass-through from the state to all residential electric customers and will be adjusted quarterly to reflect the latest sales of allowances.

Frequently Asked Questions

What
is Standard Offer Service?

Our customers who do not choose an electric supplier will receive
Standard Offer Service (SOS). This means Delmarva Power both delivers and
purchases electricity for supply to its customers.

How
does Delmarva Power purchase supplies for its SOS customers?

We follow a PSC approved competitive bid process – twice each year
Delmarva Power offers about 25 percent of the total residential and small
commercial SOS peak load for bids. The bids are for two-year contracts. This
approach has a dampening effect on price swings.

How
often do customer SOS rates change?

New SOS rates are effective for the Summer on June 1 and for Winter on October
1.

How
will the new SOS rates affect my summer, winter and annual bill?

For Maryland residential customers, the new summer SOS rate will increase, by about $6.00, the average
monthly summer bill beginning June 1, 2015 and by about $5.00 for the average monthly winter bills. Combined, this is equal to an increase of about $5.00 per month in the annual bill.

What
power plant is my electricity coming from?

It’s hard to say. One supplier was publicly announced as winning the entire SOS load during
the 2015 competitive bid process, and a total of five suppliers currently serve all of
the SOS load. The suppliers buy and trade the energy in the PJM marketplace so
tracking its origin is difficult. The bid process simply ensures that we’ll get
the needed reliable and competitive supply of electricity for delivery to our
customers.

Who
are the suppliers that were awarded contracts for June 1, 2015?

The following supplier was publicly announced as winning the supply contract for
this year;

Exelon Generation Company, LLC

Who
will be supplying my electricity?

Starting June 1, 2015 your electricity will be supplied by the following
suppliers;

Exelon Generation Company, LLC

DTE Energy Trading, Inc.

Direct Energy Business Marketing, LLC

PPL EnergyPlus, LLC

Macquarie Energy, LLC

How
much load did each supplier win and at what price?

Pricing information is confidential in compliance with PSC Formal Case No. 9056
and 9064 which govern the SOS bidding process. The percentage of load won by
each supplier is listed below.

Exelon Generation Company, LLC

35.3%

DTE Energy Trading, Inc.

26.2%

Direct Energy Business Marketing, LLC

8.3%

PPL EnergyPlus, LLC

9.5%

Macquarie Energy, LLC

20.7%

How
do I choose a supplier other than Delmarva Power?

First, you need to find out if there is an alternative retail electric supplier
available to you. You can do this by calling the Maryland Public Service
Commission, (800) 492-0474 or visit the Commission’s Web site, www.psc.state.md.us. If you are considering
a competitive supplier, you should know your “SOS Pricing Information”, which is a listing of
current and known Standard Offer Service (SOS) prices and a weighted average of
known SOS prices, including effective dates based on your rate classification.
The SOS Pricing Information includes Standard Offer and Transmission Services.
It does not include other parts of your electric bill such as the cost to
deliver electricity to your home (Distribution Services). All prices are in
cents per kilowatt-hour and are provided as information to help you evaluate Delmarva
Power’s SOS rates with offers from competing electricity suppliers.

Delmarva Power provides
each customer with SOS Pricing Information on the monthly electric bill. Such
information will change from time to time as new rates are set for the summer
and winter.

Will
my bill be the same or will new information be added?

Your bill will essentially look the same. The new rates for Standard Offer
Service will be reflected in the Supply Charges portion of your bill.

When
will the Delmarva Power rates be available?

The new rates are already available on our Web site at delmarva.com in the Tariff section.

What
kilowatt hour consumption amount did you use to calculate the increase for the
average customer?

The kilowatt hour consumption used to calculate the annual residential bill
for the average customer is about 1,000 kilowatt hours per month.

Will
I still have a different rate in the summer than in the winter?

Yes. The SOS rates that will take effect on June 1, 2015, will be your summer
rate. Winter rates will take effect on October 1, 2015.

What
is the RGGI Rate Credit?

The RGGI Rate Credit is a monthly rate credit that is applied to the bills of
all Maryland residential customers. The credit appears as a line item on the
bill. It provides a billing credit to help offset surcharges for the cost of
programs that will decrease energy demand and promote clean energy to fuel
Maryland’s future prosperity. RGGI stands for Regional Greenhouse Gas
Initiative.

Funding for the RGGI
credit comes from the Maryland Strategic Energy Investment Fund, which receives
proceeds mainly from the sale of CO2 emission allowances by the State of
Maryland. The credit is a direct pass-through from the state to all residential
electric customers and will be adjusted quarterly to reflect the latest sales
of allowances.

As public concern about ecosystems, changing habitats, pollution and land management continues to grow, we remain committed to sustainable conservation and restoration initiatives as an integral part of our business operations.
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